Power tool funding is offered by hardware stores to help customers buy updated tools or include high-margin accessories for their purchases for large house jobs. Customer financing is important to offer since the larger chains you compete have their own financing applications. Funding can raise the number of purchases made and the average order size.
Blispay, who sponsored this guide, provides a customer financing alternative for B2C hardware stores who run mortar and brick or e-commerce channels. If you currently accept Visa payments there aren’t any additional POS costs and you can provide financing in as fast as 3 days. Customers can make purchases on the internet or in your store, and purchases over $199 will be eligible for a promotion that enables them to pay it off over time.
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Power Tool Financing Options
| Who Is it Appropriate For | |
|---|---|
| Blispay | B2C hardware chains who run retail stores and ecommerce websites that are looking to provide customer financing. |
| Store Cards | Stores who will afford a specialization card program and do not mind upgrading their POS. |
| Gear Funding | equipment chains with largely B2B customers that want to provide financing for large gear. |
| Layaway Program | Stores with strong cash flows which do not need to get paid directly away for large purchases. |
1. Blispay Customer Financing
Blispay customer financing is the best solution we have found for hardware stores who have B2C clients because of the simplicity and speed of installation. The solution allows customers to take advantage of more time to cover with particular financing on large purchases, which may help them buy the updated model they really want or to add the accessories they actually require.
If you currently accept Visa obligations there are no extra costs for your small business, and you may offer funding in as fast as a couple of days. Blispay is not a fantastic fit for B2B customers since they simply offer customer financing. Blispay doesn’t have a minimum purchase amount, but purchases of $199+ qualify for no obligations and no interest if paid in full within 6 weeks.
It’s a great option to assist you compete with big box stores offering their own funding option. Your clients can use Blispay online or in your store; it’s the most flexible and versatile B2C power tool financing alternative we’ve seen.
2. Store Cards
You can partner with a bank or other lending partner that specializes in supplying retail charge solutions. Typically among the options they’ll provide is a shop card that is branded and may only be used on your store. This is a more expensive option than Blispay however, it delivers some personal branding advantages by placing your company logo on the card.
These shop cards are constructed separately for you and will require either a new POS system for your store or a software update before you can accept payments. Installing a new POS can be expensive and time-consuming along with a shop card financing solution requires 30+ days to set up.
3. Gear Funding
Many B2B customers take out gear loans from banks or financing businesses to purchase large gear. Such loans are utilized to purchase large pieces of equipment with long shelf lives.
Equipment financing is typically a solution mainly for small companies in which Blispay is not a match because they do not provide B2B funding solutions. It’s fantastic for bigger equipment purchases costing greater than $10k or to get title equipment and is the most frequent funding used in equipment dealerships.
4. Layaway Program
Layaway is a funding alternative which it is possible to offer where the customer pays off their big purchase over a period of time while you reserve the instrument for them. Customers might need a layaway option as an alternative to using credit cards if they have poor credit or do not have a large credit line.
Layaways typically need the client to place 10-20% of the expense of the power tool down as great faith that they are going to pay it off, and interest. You have to name the conditions of the financing option because you essentially act as the creditor. This isn’t a fantastic solution if your company cash flow is tight or when you would like to obtain the full payment up front.
While any of those power tool funding choices may be a good fit for your circumstances, we think the best solution for most small and moderate hardware shop is Blispay. It’s good for small, medium, and even large hardware chains that are looking to offer customer financing quickly without incurring additional point of sale expenses. For all these reasons, we will mostly focus on Blispay throughout the remainder of the article.
How to Supply Power Tool Financing in 5 Steps
Offering customer financing in your hardware shop has a very similar procedure, regardless of type. The major differences are going to be contingent on the point of sale equipment needed and the retailer fees you’ll be charged. Blispay gives the easiest solution since if you accept Visa payments it is possible to accept Blispay.
The 5 steps to offering power tool financing are:
1. Employ With a Funding Company
The first step is to seek out a financing firm which works for your precise requirements. For instance, some customer financing options will only fund in-store purchases, which won’t do the job for you if you would like to provide financing to internet shoppers. Other financing solutions have minimums or maximums that can restrict customer efficacy.
Many funding companies have lengthy application procedures that need that you submit documentation about your business, such as a P&L or Balance Sheet. Big banks like Wells Fargo or Synchrony have good funding plans, but they are sometimes time-consuming to begin, taking as long as 30 days or more.
With Blispay, on the flip side, you will just need to complete a short online survey and a representative will be in touch with the particulars of the application and to answer any questions that you may have. If you both feel as a partnership is rewarding, all you’ll have to do is sign a simple merchant arrangement. Merchants have completed the whole application process in as little as 1 hour.
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2. Make Your Payment System Compliant
To be able to process customer transactions, you will typically have to accept the funding payment at your point of sale (POS). For some electricity tool financing solutions like branded store cards, this may mean purchasing and installing fresh point of sale systems, implementing a new software system, putting new accounting processes in location, and hours spent training your workers.
Fixing a POS system could be expensive and take weeks to finish. You will pay between $1,000 and $5,000 per terminal, just for the hardware. By way of example, if you own a chain of 10 stores with 5 POS stations per store it might charge at least $50K to change, and that’s before factoring in any software or installation costs. The software could cost you an extra $1K — $2.5K per station, and you’ll probably be charged hourly for the real installation.
It is a lot simpler and cheaper to operate with Blispay’s customer financing solution. All you need in order to accept Blispay obligations is your ability to take Visa cards. If you currently take Visa, you then won’t need to alter anything associated with your point of purchase. This is a really cost-effective solution compared to other choices that induce you to reevaluate your entire POS system.
3. Market Your Power Tool Financing Choice
It’s important to ensure that your customers know about your financing deal. Put the financing particulars on large signs throughout your shop and have a hint at every point of sale station for your clients to see when they follow. It’s also advisable to advertise online which you finally have a new power tool funding alternative available.
Employees do not need to have a lot of involvement in the financing process with Blispay. By way of example, if a client comes in and wants a fresh 15 amp fixed based router he may only believe he can instantly afford the 12 amp model. All your employee has to do is mention the financing offer and show him where to apply on line, and he is walking out using the model he wants within minutes.
The target is to be certain that every single customer who walks into a shop or browses your products online understands precisely what your financing program is and the way they can register for it. Many financing companies such as Blispay will offer marketing materials for e-commerce and bodily stores such as signs and pamphlets to help you in this effort.
4. Help Your Customers Apply
As soon as you’ve got a customer interested in electricity tool funding, you are going to show them how to apply. This process might vary depending upon your financing firm, but generally necessitates some sort of application followed by a fast approval or denial of the applicant.
With Blispay, the whole application process occurs on your client’s smartphone or private computer. It’s a very simple procedure which involves filling out an application with some basic personal information and it only takes a few minutes. You will just simply must guide them to the web address (that Blispay will provide) where they could apply online, and can even incorporate the info in your advertising materials.
5. Accept Customer Payments
Once your customer has been accepted for financing you can take their payment directly at your POS. How fast you’re ready to take payments, and how you accept these, will change by funding firm. Ordinarily, you need to be able to type a card number or credit account number into your POS and allow your clients to make a purchase on credit.
Customers approved for Blispay is going to be shown a digital version of their Blispay card that you can use to type in your POS terminal if they’re in your shop, or they can enter your current checkout form if they are on your website. After, they will be sent a physical card they can use for future purchases.
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Advantages of Offering Power Tool Financing
There are many advantages to providing Blispay’s customer financing product at your hardware stores, from increasing your overall sales and average basket size to gaining repeat clients. Your customers will benefit by spreading out big buys over 6 months, and it’ll benefit your store in a number of ways.
1. Increases Your Average Sale Amount
Blispay has seen average sales for clients using their financing products increase by as much as 150% in certain stores than clients who don’t utilize Blispay financing. As more customers finance purchases with higher AOV’s, your overall earnings will likely increase too.
Clients are very likely to spend more cash with you later on if you provide them financing. In reality, 66 percent of customers make at least one additional cost of $500+ in the future using a shop that offers financing. That’s money that should go to increasing your total sales instead of losing that revenue to a rival like Home Depot who gives customer financing.
Let’s say, for example, that a customer is building a dining room table and needs a new table saw. Offering a financing choice could help her update from the simple version selling for $300 into the high-end variant they actually want at $600. The exact same customer could also add accessories to the buy, further increasing the basket dimensions. This, over time, will increase your typical sales amount as an increasing number of customers look to finance bigger purchases and/or become repeat customers.
2. Increases Client Loyalty
Customers might shop somewhere else if they receive a financing offer from one of your competitors. A recent survey indicates that 42 percent of customers are more inclined to shop in a retail location that offers consumer funding. The amount increases to 55 percent for millennials. It is becoming more important to offer customer financing on your store if you want to compete.
Blispay does not have a minimum purchase quantity and purchases of $199+ may qualify for a no obligations, no interest promotion if paid in full within 6 months. Offering this to your customers can enhance the customer experience by fulfilling their needs. Not having to search elsewhere for financing gives the consumer a chance to obtain a table saw or a cordless nailer in the future.
3. Quick Approval Process
Among the wonderful things about Blispay’s customer financing alternative is that your customers can get approved quickly, right within your store. You can offer financing and your clients might be approved to purchase power tools within seconds. This can help you get additional sales and your clients get from the shop and started on their project.
4. Free For You to Offer
Together with Blispay’s customer financing choice, there are no monthly charges and you’ll incur zero added merchant fees. It’s a cost-effective solution with plenty of upside to your company. What is more, it’s totally free and easy to promote the availability of financing with Blispay; all you have to do is set up signage in your shop and messaging on your website.
5. Enhances Customer Satisfaction
When performing a home-based project, your customers probably want the highest quality tools. Sometimes they do not have the cash available to cover itif they can afford it. Distributing payments over 6 months assists them pull the trigger equipment they need but may not buy otherwise.
Furthermore, if you are using Blispay’s customer funding, your repeat clients are rewarded with 2 percent money back on potential purchases made at your shop or your e-commerce site.
6. Helps You Compete With Big Box Retailers
You’re probably competing with large box retailers such as Lowes or Home Depot at least some of your hardware shop locations. These shops provide their own financing programs that can draw customers away from your store in case you don’t provide something. Some customers expect a funding option and others will need it so as to make large purchases.
Blispay offers the easiest and most affordable customer lending option for hardware store chains. If you currently accept Visa card payments then you could be accepted and prepared to provide customer financing within 1 business day. This can help you keep your customers and boost their average purchase size whenever they’re doing a project, and it will not cost you any additional fees to provide it.
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Blispay Power Tool Financing Rates, Terms, & Qualifications
The costs and terms of customer financing vary by financing company. Some will require that you purchase brand new POS systems and several will charge a small fee of 1 — 5 percent for each financed sale. Blispay costs you nothing along with the processing fees you already incur to accept Visa credit cards, and also you may get it set up in as quick as 3 days.
Blispay Power Tool Financing in a
| Time for Merchants to Qualify | No More than 1 day |
| Merchant Fees | No added fees beyond your regular credit card processing fees |
| Employee Training Needed | Minimum |
| Type of Borrower | Prime or Prime Plus |
| Card Details | No payments and no interest on all purchases over $199 if paid in full within 6 weeks |
| Time to Clients to Qualify | A few minutes |
Customers typically utilize Blispay because of how simple it is to sign up and use. Prime borrowers can qualify by filling out a brief application directly on their phone right on your store or online on your e-commerce site. They will receive a fast credit decision and when approved, they’ll be prepared to fund their purchase. Each accepted customer will get 6 months of financing, but might have to pay accrued interest if they don’t fully pay it off over 6 months.
In accordance with Blispay’s CEO, Greg Lisiewski:
“Blispay is the only financing product which operates for companies who conduct sales through both e-commerce and brick and mortar stations, simplifying startup expenses, operations, and client understanding.
Should you accept Visa credit cards than you already accept Blispay and may have received Blispay financed purchases previously. It doesn’t cost anything extra to have a customer finance a buy with Blispay. All you need to do is market that it’s an available option, and a number of our retailers are seeing an AOV for Blispay purchases which are 35%-150% greater than non-Blispay purchases”
Blispay is as close as you can get to a plug and play client financing choice. You can apply today and begin accepting Blispay card payments as quickly as tomorrow. Customers who cover with Blispay can shell out an average of 35 percent more in shops than clients who pay with other procedures. There are no additional merchant fees.
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The Bottom Line
Power tool funding provides your clients the chance to produce large or additional purchases and can enable you to compete with big box stores like Lowes or Home Depot. Your customers expect a funding option, and offering one can improve your average store sales and client retention.
Blispay helps you offer power tool financing to your customers in your shop and on the internet. You are able to accept Blispay payments just as you would another Visa card purchase. It is easy to setup and simple to keep. It is possible to apply today and be ready to go in as quick as 3 days without paying any additional merchant fees.
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